A rental property can be a great source of passive income. However, it can also quickly turn into a massive headache. Maybe you are tired of phone calls on the weekends about a broken furnace. Perhaps you are thinking about relocating. The property may not perform as well as you would hope, or you need some cash to finance another project.
No matter your circumstances, you may find yourself in a situation when you want to sell your rental property quickly. Unfortunately, unloading your investment property is not as simple as calling your real estate agent and putting it on the market.
Besides the typical hassle that comes with selling a property, you will need to deal with an additional factor: what should you do about your tenants? Your first step should be to consult your local landlord-tenant laws to avoid any litigious mistake that would slow down the sale process.
Here is what you need to know when you are considering selling your rental building.
Selling your rental property rented or vacant?
There are many factors to consider when deciding between selling your rental property rented or vacant.
An empty property is easier to show. You will not need to worry about giving notice to your tenants or wonder if the unit is left in disarray. You can also update and repair the building if required. A vacant rental property can be a lot easier and faster to close.
On the other hand, you will not need to worry about carrying the mortgage of your investment property if you sell it while it is occupied. Remember that investment properties typically sit longer on the market and take longer to sell than a single-family home. However, difficult tenants could put the entire deal in jeopardy.
If you decide to sell your rental property vacant, you will need to wait until your tenants’ leases expire. Overwise, you will need to negotiate with the renters.
Handling the negotiations with your tenants
Tenants with a month-to-month contract
If you have month-to-month tenants, you will need to give them 30 to 60 days’ notice to vacate the property depending on your state (60 days in Georgia).
Tenants with a fixed-term lease
Unless your rental contract includes an early termination clause, you will need to wait for the lease to expire. You can also try to negotiate with your tenants to leave early by offering financial compensation or helping them to find suitable alternative housing, for example.
Negotiating with tenants
No matter the circumstances, ensuring your tenants’ cooperation is essential for a fast and smooth sale of your rental property. Please make sure you are respectful of their situation to make it as easy for them as possible. You may need to offer some incentives to make sure that each unit can be shown easily and on short notice. For example, paying for a cleaning service or gift cards for local activities will make it easier to show the property in its best light.
What to do if your tenants are difficult?
Disgruntled tenants can turn your rental property’s sale into a nightmare. They will undoubtedly scare away some potential buyers and could slow down the transaction considerably.
They can cause severe damages to the property or turn litigious if they refuse to leave the property. You must be prepared to start a lengthy and onerous eviction process if you feel that existing tenants may be difficult to deal with.
An alternative solution consists in selling your rental property to a company which will handle tenants’ negotiations and close rapidly.
If you are considering selling your investment property quickly in Cherokee and Cobb County, including Woodstock, Marietta, Kennesaw, Acworth, Canton, and Roswell, we may be able to help. Contact us today to know if it may be the right solution for you.